Brexit, Legal Professional Privilege and the European Union
The UK’s exit from the European Union will have ramifications for legal professional privilege across the continent, and especially for lawyers qualified in England and Wales.
Legal privilege against the disclosure of communications to the European Commission has largely been developed by the CJEU through case law. There are no provisions regarding legal professional privilege in the TFEU, or any other Council or Commission instrument. The basis for legal professional privilege in an EU context lies in an exception – developed through case law – to the Commission’s general power to examine all documents under the original implementation regulation, Regulation 17/62 of 13 March 1962 (“Regulation 17/62”).
The leading case is AM&S Europe Ltd v Commission (Case 155/79  ECR 1575) (“AM&S”). The ECJ held that Regulation 17/62 should be interpreted to recognise the confidentiality of certain communications between a lawyer and his client. This privilege is available only in narrow circumstances, to protect against requests for disclosure of confidential documents in the course of a client’s dealings with the European Commission, for example during a cartel investigation. In proceedings before national courts, national rules on privilege will apply, even if the litigation concerns the consequences of an EU investigation.
The AM&S exception is only available provided that two conditions are satisfied. Firstly, the communication must be for “the purposes and in the interests of the client’s rights of defence”. Secondly, the communication must be between a client and external independent legal counsel, who are qualified to practice in an EEA member state. This second condition excludes the advice of in-house lawyers and lawyers not qualified in an EEA member state. We will come back to this latter point.
The privilege established by AM&S was subsequently expanded by the General Court in of Akzo Nobel Chemicals Ltd and Akcros Chemicals Ltd v Commission (Case C-550/07 P)  (“Akzo”). The General Court applied EU privilege to documents prepared for the instruction of external counsel. The General Court held that the preparatory documents could be protected from disclosure even if they had not yet been exchanged with an external lawyer, or even if they were never created to be physically sent to the external lawyer, provided that the documents were drafted exclusively for the purpose of seeking legal advice.
Britain’s exit from the European Union has implications for legal professionals in England and Wales. The AM&S case suggests that the clients of English qualified lawyers will be unable to assert legal professional privilege arising from communication with those lawyers against the Commission should the UK cease to be an EEA member state post-Brexit. Therefore the advice of English qualified lawyers given after the date of Brexit will not be treated as privileged in the EU and therefore not capable of being withheld from the Commission during the course of an investigation. AG Kokott stated in her 29 April 2010 Opinion in Akzo that, even if the AM&S privilege was eventually expanded to include in-house lawyers that were accredited within the EEA, “the inclusion, in addition, of lawyers from third countries would not under any circumstances be justified”.
For EEA qualified lawyers wishing to continue practising in the UK, the privilege regime will remain unchanged. The case of IBM Corp v Phoenix International (Computers) Ltd  1 All ER 413 confirmed that legal advice privilege in the UK applies to qualified foreign lawyers, provided that there is a clear lawyer / client relationship and that the other existing requirements for privilege are met. This is the case regardless of whether the foreign lawyer is advising on English law or the law of his or her qualification. The case of Garfield v Fay  2 W.L.R 1479, shows that the operation of litigation privilege will remain similarly unchanged by Brexit.
The effect of Brexit on privilege, whilst significant, is unlikely to affect the majority of the English legal profession. Legal professional privilege before courts in England and Wales will remain unchanged, as will the privilege regimes currently extant in individual EEA member states. Although Brexit is still two years away, many solicitors who practice EU competition law have already started to cross-qualify into other EEA jurisdictions and firms in Brussels have started to exclude those qualified in a UK jurisdiction from acceptable applicants for some jobs.
Colin Passmore is the Senior Partner of Simmons & Simmons in 2011, but continues to maintain his litigation practice. Over the last 31 years Colin has worked in England, Hong Kong and the Middle East from where he has developed a varied commercial litigation practice that encompasses both international and domestic disputes. His particular focus areas are retail finance litigation, extradition disputes and large professional indemnity claims.
Colin published the 3rd edition of “Privilege” in July 2013. This is one of the leading textbooks on the subject of legal professional privilege. Colin also authors Passmore on Privilege: a blog, which reviews the more interesting cases arising under the law of legal professional privilege.
Oliver Thomson, a Trainee Solicitor at Simmons & Simmons, assisted with the development of this publication.